Imágenes de páginas
PDF
EPUB
[ocr errors][subsumed][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small]
[blocks in formation]

Cooper, L. Napoleon, chairman, AP Action & Co., Inc.; Project 76-An
American Affair, Inc., Cleveland, Ohio__-.

Attachments

94, 96

Hessen, Robert, Graduate School of Business and Hoover Institution,
Stanford University, Stanford, Calif___

Solk, Gerald, associate professor of law, University of San Fernando
Valley, College of Law, Sepulveda, Calif._

[ocr errors]

Peterson, Peter, chairman of the board, Lehman Bros__.

103

Petrie, Donald, Washington, D.C__

111

[merged small][merged small][merged small][merged small][ocr errors][ocr errors]
[blocks in formation]
[blocks in formation]

CORPORATE RIGHTS AND RESPONSIBILITIES

TUESDAY, JUNE 15, 1976

U.S. SENATE, COMMITTEE ON COMMERCE, Washington, D.C.

The committee met at 10:05 a.m. in room 5110 of the Dirksen Senate Office Building, Hon. John A. Durkin, presiding.

OPENING STATEMENT BY SENATOR DURKIN

Senator DURKIN. Good morning, ladies and gentlemen. We are beginning an inquiry which, in my opinion, is crucial to the well-being of our people and the country. One issue which seems to reoccur and which must be dealt with to preserve a free society is what to do about concentrations of political and economic power. How do we control and hold accountable huge institutions and make them relevant and understandable to ordinary people? To what extent do we profit from these organizations and to what extent is each of us limited or harmed by their actions? These are exceedingly difficult questions to answer, and ones for which I have no easy solutions.

The concentration of economic, political, and environmental power in large corporations has long been an overriding concern to me. In January this year I wrote to the chairman of this committee expressing my concern about the power and influence wielded by giant corporations being used and misused without any apparent check. I would like to have a copy of that letter placed in the hearing record. [The letter follows:]

U.S. SENATE, Washington, D.C., January 28, 1976.

Hon. WARREN G. MAGNUSON,
U.S. Senate,

Washington, D.C.

DEAR WARREN: The concentration of enormous economic, political, and environmental power in large multinational corporations has long been of overriding concern to me. The recent revelations concerning abuses by these giants have only served to heighten my concern.

The power and influence wielded by these corporate mastodons have been used and misused without any apparent check. Although serious efforts have been made to determine the scope of the power and influence of these mammoth organizations, little useful information has been collected. The impact of the incalculable power and influence, however, can be seen in every sector of our national life and international relations.

It is clear that neither the Federal Government nor the States that charter these corporate giants have adequate tools to deal with the power they wield. Indeed, the tool that has the most promise of bringing these giants into tow, the corporate charter, has developed into a revenue source for which the various States compete by relaxing their chartering requirements.

Staff members assigned to these hearings: Paul Cunningham, David Berger, and Stephen Hallaway.

(1)

The Federal Government has had no more success in regulating these organizations than have the States in chartering them. The relatively few areas that are subject to regulation have been unsuccessful because the regulatory agencies have, in most cases, become captives of the industries they regulate.

Recently, the idea of Federal chartering of these corporate cyclops has received renewed attention. Although my initial instincts do not suggest an expansion of the Federal role into an area traditionally reserved to the States, something must be done. The concept of Federal chartering as a possible method of bringing the giant multinationals into reign deserves to be examined in depth. Such an examination may lead us to legislation in the corporate chartering area, or it may result in the development of alternative methods of accomplishing the same goal.

I wanted to take this opportunity to inform you of my concerns in this area and to encourage you as chairman of the Commerce Committee to consider calling hearings on these matters.

Respectfully,

JOHN A. DURKIN.

Senator DURKIN. The Chairman has wisely called for hearings now at a time when the public is concerned about the influence and effect that corporate activities have on their lives and communities. The proposal of the Nader corporate accountability research group and the call for Federal legislation present an especially good opportunity for Congress to begin an examination into these questions.

What is true and accurate about corporations is difficult to find out. There are many arguments for and against leaving big business alone-arguments on all sides that are persuasive, chameleonlike statistics that seem to fit comfortably in any argument and moral and patriotic justifications for any action or inaction. These hearings are an opportunity to get to the heart of these conflicting arguments, to increase our understanding and to propose and enact appropriate legislation, if appropriate.

An example of the difficulty I have with this entire area is that it never made much sense to me to have a State such as Delaware, or any State for that matter, chartering Exxon, General Motors, ITT, or any of the other corporate mastodons. Canada, a country with its own federal system not unlike our own, has a national corporation law. The Organization for Economic and Cooperation Development has just recently agreed to a general code of conduct for international investment and multinational enterprises. But in our country, the State of Delaware charters the largest corporation in the world, plus about one-half of the 1,000 largest corporations in the United States. Yet, Exxon had sales of over $45 billion in 1974, larger than the gross national products of over a hundred countries including Austria, South Africa, and New Zealand, while Delaware had less than a billion dollars in annual revenues. General Motors employs more people (738.000) than live in the entire State of Delaware (548,000), while the State government of Delaware employs about 13,000 people. The connection with the State of some of the corporations chartered by Delaware is only a small box address and the payment of annual franchise taxes. And yet some of these corporations, ITT for example, have operations in more countries in the world than many nations. have embassies and engages in activities in foreign countries, such as in Chile, which have a direct effect on our national foreign policy. Still the State of Delaware retains the authority through its corporate laws to regulate the internal governance of these corporations.

« AnteriorContinuar »